Zero Co., Ltd. (9028) AI Stock Analysis

• Market Cap: ¥55.33B
• Dividend Yield: 3.57%
• Average Volume (3M): 30.46K
• Price to Earnings (P/E): 13.1
• Beta (1Y): 0.71
• Revenue Growth: 3.90%
• EPS Growth: 32.17%
• Country: JP
• Employees: 2,647
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Dealerships
• EPS (TTM): 76.01
• Shares Outstanding: 17,560,242
• 10 Day Avg. Volume: 26,280
• 30 Day Avg. Volume: 30,456
• PEG Ratio: 0.10
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 0.35
• P/FCF Ratio: 4.82
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 438.3
• Revenue Forecast (FY): ¥151.00B

• Rating: 73 Outperform
• Price Target: ¥3,730.00 ▼(-7.44% Downside)
• Action: Reiterated Date: 02/19/26
• Date: Action: Reiterated 02/19/26

The score is driven primarily by improved profitability/ROE and strong free-cash-flow generation, reinforced by an attractive valuation (low P/E and high dividend yield). These positives are tempered by weak technical momentum and the recent TTM revenue decline alongside higher debt versus the latest annual period.

Positive Factors

Improved profitability and ROE

Margins and ROE have meaningfully improved versus prior years, indicating stronger earnings power and operational efficiency. Sustained margin expansion supports internal reinvestment, dividend capacity and resilience to cyclical volume swings over the next several months.

Strong cash generation

Consistent operating cash flow and robust FCF provide durable funding for capex, working capital and shareholder returns. Growing FCF (about +8.2%) shows improving cash conversion that enhances balance-sheet flexibility through industry cycles.

Manageable leverage and equity growth

Relatively low leverage and rising equity support financial resilience and capacity to absorb cyclical shocks. A conservative capital structure limits interest burden and preserves optionality for investments or partnerships over the medium term.

Negative Factors

Recent top-line softness

A decline in TTM revenue signals weakening demand or volume mix that can pressure utilization in vehicle logistics. If the top-line soft patch persists, it could limit margin leverage, slow cash-flow growth and constrain strategic investments over coming quarters.

Incremental borrowing

Rising total debt despite manageable D/E suggests the company used additional borrowing recently. In a period of softer revenue this incremental leverage could reduce financial flexibility and raise interest costs, increasing vulnerability if volumes stay weak.

Working-capital / cash conversion drag

Although absolute FCF is strong, cash flow relative to operating profitability is under 1, indicating earnings don't fully convert to cash. Structural working-capital timing issues can tighten liquidity and amplify stress during revenue downturns.

Zero Co., Ltd. Business Overview & Revenue Model

Company Description

ZERO Co., Ltd., together with its subsidiaries, provides vehicle transportation and maintenance services in Japan. It offers new and used vehicle transportation, and door-to-door transportation of private cars and motorbikes. The company also offers new, heavy vehicle, and other maintenance services; handling and vehicle inspection services at auto auction; car selection services; general cargo transportation services; and human resources services, including pick-up and dispatching services. In addition, it provides port transportation and warehousing services; vehicle control and management services; temporary and placement services; and customs clearance services, as well as exports and sells used cars and automobile parts. The company was formerly known as Nissan Transportation Co. Ltd. and changed its name to ZERO Co., Ltd. in May 2001. The company was incorporated in 1961 and is headquartered in Kawasaki, Japan.

How the Company Makes Money

The company primarily makes money by charging customers fees for logistics services centered on vehicles. Key revenue streams include (1) transportation fees for moving finished vehicles from production sites, ports, or storage yards to dealerships or other delivery points, and (2) distribution-related service fees tied to handling vehicles within the logistics chain (e.g., staging and yard operations associated with vehicle distribution). The company’s earnings are driven by shipment volumes and contracted logistics work from vehicle manufacturers and related businesses; specific material partnerships or customer concentration details are null.

Zero Co., Ltd. Financial Statement Overview

Summary

Profitability and returns have improved versus prior years (TTM net margin ~4.7% and EBIT margin ~6.8%; ROE ~16.8%), supported by strong operating cash flow and free cash flow (~¥15.0B and ~¥12.5B). Offsetting this, TTM revenue is down ~2.9% and total debt increased versus the latest annual period, which bears monitoring if softness persists.

Income Statement

Results show a solid profitability profile and improving efficiency versus prior years. Net margin in TTM (Trailing-Twelve-Months) is ~4.7% with EBIT margin ~6.8%, both materially better than FY2024 (~3.0% net; ~4.5% EBIT), indicating better cost control and/or mix. Revenue has scaled meaningfully over the past several years, but growth has cooled: TTM revenue is down ~2.9% versus the prior period, following modest growth in the latest annual report. Overall: good margins for the segment and strong earnings vs history, tempered by the recent top-line soft patch.

Balance Sheet

Leverage looks manageable with debt-to-equity around ~0.26 in TTM (Trailing-Twelve-Months), improved from the higher gearing seen in FY2024 (~0.38). Equity has also grown over time, supporting balance-sheet resilience. Profitability on equity is strong at ~16.8% in TTM (Trailing-Twelve-Months), up from ~11.2% in FY2024, which signals better earnings power relative to the capital base. Key watch-out: total debt increased from the most recent annual period (FY2025) to TTM, so while leverage remains reasonable, incremental borrowing bears monitoring if revenue stays soft.

Cash Flow

Cash generation is a clear strength. Operating cash flow and free cash flow are strong in TTM (Trailing-Twelve-Months) (about ¥15.0B and ¥12.5B, respectively), and free cash flow grew ~8.2%. Free cash flow runs at ~0.83x of net income in TTM (Trailing-Twelve-Months), suggesting earnings translate well into cash. A mild weakness is that cash flow relative to reported operating profitability is not especially high (coverage ratio under 1 across periods), implying some working-capital or timing drag despite healthy absolute cash production.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	144.73B	147.84B	140.75B	132.86B	107.05B	92.17B
Gross Profit	21.13B	21.75B	17.67B	15.20B	13.13B	13.40B
EBITDA	14.87B	15.24B	11.47B	9.75B	8.35B	9.12B
Net Income	6.71B	7.18B	4.15B	3.44B	2.54B	3.63B
Balance Sheet
Total Assets	74.84B	73.95B	70.73B	56.56B	55.19B	50.94B
Cash, Cash Equivalents and Short-Term Investments	15.46B	16.64B	11.32B	5.87B	5.65B	5.90B
Total Debt	9.80B	11.27B	14.25B	7.29B	10.52B	10.62B
Total Liabilities	29.22B	30.41B	32.86B	22.72B	24.57B	22.63B
Stockholders Equity	44.90B	42.90B	37.21B	33.28B	30.07B	28.28B
Cash Flow
Free Cash Flow	12.51B	10.74B	8.99B	6.87B	1.36B	5.63B
Operating Cash Flow	14.99B	12.86B	11.23B	8.78B	3.95B	8.59B
Investing Cash Flow	-3.29B	-2.84B	-4.66B	-2.17B	-3.27B	-3.10B
Financing Cash Flow	-8.73B	-4.61B	-824.00M	-6.29B	-1.61B	-4.36B

Zero Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4030.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9028, the sentiment is Negative. The current price of 4030 is above the 20-day moving average (MA) of 3633.50, above the 50-day MA of 3792.10, and above the 200-day MA of 3382.02, indicating a bearish trend. The MACD of -98.88 indicates Positive momentum. The RSI at 33.17 is Neutral, neither overbought nor oversold. The STOCH value of 8.75 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9028.

Zero Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4732	83 Outperform	¥771.10B	19.01	19.13%	2.64%	7.58%	15.12%
9028	73 Outperform	¥55.33B	13.13	―	3.57%	3.90%	32.17%
7599	66 Neutral	¥124.40B	8.08	―	2.82%	11.66%	-7.47%
7593	63 Neutral	¥59.51B	10.40	―	4.49%	8.56%	-13.47%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
3186	53 Neutral	¥227.89B	16.36	―	1.24%	21.79%	9.89%
7602	48 Neutral	¥4.45B	-10.59	―	1.08%	-2.36%	-1738.42%